Scheduling of machines and transportation devices like Automated Guided Vehicles (AGVs) in a Flexible Manufacturing System(FMS) is a typical N-P hard problem. Even though several algorithms were employed to solve this combinatorial optimization problem, most of the work concentrated on solving the problems of machines and material handling independently. In this paper the authors have attempted to schedule both the machines and AGVs simultaneously, with makespan minimization as objective, for which Differential Evolution (DE) is applied. Operations based coding is employed to represent the solution vector, which is further modified to suit the DE application. The authors have proposed two new strategies of DE in this paper which better suits the problem. We have developed a separate heuristic for assigning the vehicles and this is integrated with the traditional DE approach. The hybridized approach is tested on a number of benchmark problems whose results outperformed those available in the literature.